On June 17, 2024, FIBRA Prologis, the real estate investment trust specializing in Class A logistics properties in Mexico, will register a public acquisition and exchange offer to obtain up to 100% of the real estate trust certificates (CBFIs) of FIBRA Terrafina. This offer includes a "reciprocal substitution" where each Terrafina CBFI will be exchanged for 0.58 FIBRA Prologis CBFIs, potentially resulting in the issuance of over 448 million new FIBRA Prologis CBFIs, equivalent to approximately 34% of its total outstanding certificates.

According to the company, if there are no deadline extensions, the offer will expire on June 14, 2024, at noon Mexico City time, and settlement will take place on June 18, 2024, the first business day after the registration date, provided all procedures established in the agreement are met.

The trust states that for the offer to be effective, a minimum of 51% of FIBRA Terrafina CBFI holders must participate, along with all necessary governmental approvals and authorizations, including those from the National Banking and Securities Commission (CNBV) and the Federal Economic Competition Commission (COFECE). If all authorizations are not obtained by September 15, 2024, the offer will be canceled.

FIBRA Prologis has taken care to clarify that its CBFIs are not registered under the U.S. Securities Act of 1933. This means these certificates cannot be offered or sold in the United States unless they are registered or qualify for an exemption allowing their sale without registration. Therefore, the public offer will only take place in Mexico, ensuring full compliance with the relevant regulations and providing a secure environment for the transaction.

The pursuit of FIBRA Terrafina, a race that involves at least five investors in addition to FIBRA Prologis, is a strategic move to consolidate the largest industrial portfolio in Mexico. As of the first quarter of 2024, Terrafina reported a robust portfolio of 291 properties, including 287 industrial buildings, with a substantial gross leasable area (GLA) of approximately 3.9 million square meters and four land reserves to ensure the portfolio's organic growth capacity. In comparison, FIBRA Prologis closed the first quarter with 236 logistics and manufacturing facilities in six industrial markets in Mexico, totaling 4.4 million square meters of GLA. With the acquisition of Terrafina's industrial properties, FIBRA Prologis would secure the largest industrial portfolio in Mexico, even surpassing the potential six million square meters that FIBRA Next might have.

According to data analyzed by SiiLA, over the past decade, the gross leasable area (GLA) of FIBRA Prologis' industrial portfolio has grown by an impressive 50% with the acquisition of at least 52 properties. This growth has been mirrored in the trust's income, which has increased tenfold, from 150 million (around 8.9 million dollars) to over 1.5 billion pesos (nearly 88.7 million dollars) annually, as reported by SiiLA FIBRA Analytics. These figures underscore the potential benefits that the acquisition of FIBRA Terrafina's industrial portfolio could bring to FIBRA Prologis.

It is worth noting that 51% of FIBRA Prologis' GLA is concentrated in northern Mexico, followed by its presence in the Center (36%) and Bajio (13%) regions. With the possible incorporation of FIBRA Terrafina's industrial portfolio, these proportions would be 58% in the North, 26% in the Center, and 16% in the Bajio. This implies strengthening the trust's manufacturing inventory, mainly in Reynosa, Tijuana, and Ciudad Juarez, and balancing the logistics inventory for consumer markets, primarily in Mexico City, Monterrey, and Guadalajara.

For more information on this and other industrial real estate transactions, explore SiiLA REsource or contact us at contacto@siila.com.mx.